The gold market suffers from a lack of upward trend due to an increase in interest rates. This circumstance forced one Canadian bank to lower its forecasts for gold and silver quotes.
Analysts at BMO Capital Markets Bank in their latest commodity market report reported a 6% reduction in their forecast for the 2023 gold exchange rate, to an average annual level of $1,649 per ounce. Prices are expected to continue to decline into 2024, so the forecast figure is $1,615 an ounce, down 4% from the previous forecast.
The long-term outlook for the gold exchange rate remains unchanged at $1,400 an ounce.
The bank is even more pessimistic about the fate of silver, expecting the average annual rate in 2023 at $19.9 per ounce, which is 11% lower than the previous forecast. Silver is forecast to average $21.4 an ounce in 2024, down 3% from the previous forecast. In the long run, the silver rate should reach $20 per ounce.
Analysts said recessionary risks would put downward pressure on silver over the next two years.
In addition, analysts noted the following: "Demand for silver exchange-traded funds has decreased, and macroeconomic conditions are not developing well for precious metal, reducing industrial demand. All this is happening against the background of aggressive monetary policy. Therefore, silver lags behind gold in terms of the dynamics of quotations. "
However, in the long term, according to bank analysts, industrial demand for silver will grow due to the demand for solar energy. Thus, by 2030, industrial demand for gray metal will grow to 154 million ounces (which is higher than the previous forecast - 117 million ounces).